Apple Report Reveals Environmental Misdeeds In Supply Chain

Apple has released its 2013 Supplier Responsibility Progress Report which unveils its 2012 audits and findings. And the results are not terribly encouraging as it reveals a long string of serious environmental screw-ups.

The company's report lists details about the 393 inspections, including 55 environmental audits, which represents a 72% increase in audits for supply chain manufacturers. While the fact that the number of audits has increased dramatically is incredibly positive, what has been found is flat out frightening.

Business Green sums it up: "The 37-page report reveals a litany of environmental violations of the company's Suppliers Code of Conduct, including evidence 147 facilities failed to properly store, move or handle chemicals, 85 sites failed to label hazardous waste storage locations and 119 facilities lacked management processes for labelling hazardous materials, and over 100 facilities were not recycling or disposing of hazardous waste in compliance with local laws. The one supplier found to be intentionally dumping waste cutting oil in the rest room was placed on probation by Apple and required to hire an external expert to develop a corrective action plan."

Business Green points out, "Overall, 22 per cent of suppliers were found to have practices that were not compliant with the environmental elements of Apple's code of practice, while 28 per cent failed to have appropriate management systems in place."

On the worker's rights side of things, Apple performed an audit with Guangdong Real Faith Pingzhou Electronics (PZ), and found that the company employed 74 child workers, with an employment agency creating false documents that would allow the kids to work at the company. Reuters reports, "Child labor is an issue that is part of the larger supply industry as the component maker that Apple found violated child labor laws supplied parts to more than a hundred different companies, including automotive companies, [Apple senior vice president of operations Jeff] Williams said, vowing to eradicate under aged labor from the industry."

As TechCrunch points out, "Apple has faced criticism in the past for doling out corrective measures that seem rather toothless – most often putting suppliers 'on probation,' meaning they’ll be watched more closely for future violations." But with this supplier, "Apple terminated the relationship with that offending party entirely, proving that there are real consequences for companies that ignore its code of conduct and local labor laws."

Will the same go for environmental violations? Apple's report states, "We do not tolerate environmental violations of any kind." But if that were true, the company would be out of business, as the audits reveal so many, many, many violations among suppliers.

However, with both the language in place and a growing willingness to reveal findings from audits, perhaps Apple will indeed be able to have a zero-tolerance policy with suppliers on both environmental and workers' rights standards. Page 27 of the report details what happens in Apple's environment-focused audits, and states, "When we discover serious impact to the environment, we require processes to be shut down until they can be remedied. We give the facility 90 days to meet our requirements. Once they fix the problem, we follow up with the supplier to verify everything. In addition, we have third-party experts—such as the IPE or local NGOs—validate these findings and completed corrective actions. By opening our supply chain to outside organizations, we increase transparency and make sure our suppliers’ environmental impact is carefully reviewed."

The simple fact is a company the size of Apple, which produces products with rigid design specifications and standards, is going to have a supply chain with some serious problems. That is practically unavoidable with so many players. But to have the company at least appear to want to fix things, to reveal the serious flaws that exist and the actions they're taking to improve, is noteworthy. Apple is one of those companies with a love-hate relationship with environmentalists. For every positive step -- like reducing the use of toxic materials in their devices -- there seems to be a step in the wrong direction -- like designing a new product to be harder, or impossible, to repair. But we must admit that simply the move of increasing transparency and increasing audits is at least deserving of a thumbs up, and hopefully will also help to pull more tech companies in the same direction.